CSCMP's Supply Chain Quarterly
October 23, 2018

Bring carriers into the sales loop

When shippers share sales forecasts with their carriers, both parties win.

Given the volatility of today's economy, and with oil prices unpredictably bobbing up and down, shippers and carriers need to work closely together. Collaboration, in fact, offers the best way for shippers to control transportation costs and ensure there will be adequate capacity to move their freight. For such collaboration to happen, though, shippers and carriers have to talk candidly and share information freely. In the past, however, shippers generally have not been willing to provide carriers with what may be the most critical piece of information: their sales forecast.

Sharing sales forecasts for at least 60 days out would help carriers get an idea as to what loads they can expect, on which routes, and when they might be coming. With that information in hand, carriers could plan ahead, taking the requisite steps to ensure that equipment and operators will be available to handle those shipments.

When shippers share sales forecasts, they help not just their carriers but also themselves. For one thing, this kind of information sharing can improve the load-acceptance rate. And, as just noted, working with carriers to plan their business in advance can alleviate capacity shortages. Equally important: By sharing forecasts, shippers can also ensure that loads move at fixed, negotiated prices. That's a far better strategy than paying the higher prices that come with last-minute movements made on the spot market when capacity comes up short and shippers have to scramble to place their loads.

James A. Cooke is a supply chain software analyst. He was previously the editor of CSCMP's Supply Chain Quarterly and a staff writer for DC Velocity.

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